You’d need to spend around 12 times the typical annual income to purchase a home within the UK’s least affordable city – and it might surprise you to definitely learn that it’s not London. In the opposite end from the scale, however, there are a number of budget-friendly places where you can bag a bargain.
New data from Lloyds Bank has revealed the country’s most – and least – affordable cities to purchase a home, in line with the ratio of average house prices to average earnings.
Oxford tops the table of costliest areas, with homes costing 12.6 times annual income. By comparison, buyers in Stirling or Londonderry will need to pay just 4.Four times their annual earnings.
Here, we explore the data and let you know that to find an area where one can manage to buy.
Most affordable UK cities
While purchasing a house might seem daunting, you may still find places in the united kingdom where home ownership is relatively achievable for many people.
The report claims that Stirling in Scotland and Derry in Northern Ireland would be the UK’s least expensive locations. With average house prices of lb181,699 in Stirling and lb118,436 in Derry, locals will need to spend just 4.4 times their annual earnings to purchase a house.
Below-average house prices in Newry in Northern Ireland, Bradford in Yorkshire and Lancaster in the North West of England also mean buyers can purchase a house for under five times their annual income.
Some areas are affordable because of high earnings rather than low house prices. For example, Hereford in the western world Midlands has an average house price of lb236,539 – well in excess of the other 20 most affordable locations – but locals can secure a house at just 5.1 times income.
You may use the table below look around the top 20 least expensive UK cities.
Least affordable cities within the UK
Homes in Oxford have an average price of lb406,491, based on data in the ONS. That’s around 12 times more than the average resident there earns over a year.
In the table of least affordable areas, Oxford is closely accompanied by Chichester, Winchester and Truro, which have average house prices of 11 times annual income.
Greater London comes next, with an earnings-to-property price ratio of 10.3, although Lloyds notes that the huge variations within the London property market mean some individual boroughs would probably rank much higher.
In certain cases, the average property price is not necessarily excessive, but low earnings put home ownership unrealistic. In Truro, for example, the typical price is a somewhat modest lb234,471, but residents would still need to pay 11.1 times their income to afford this.
Are these also the the best places to live?
Halifax recently published research on top 50 the best places to live round the UK.
While, perhaps unsurprisingly, many of the least affordable cities were several of the most desirable places to reside, there is an exception.
Halifax named the Derbyshire Dales as the 10th best place to reside in the UK, and also the nearby town of Derby was among the most affordable cities, with residents spending just 5.9 times their income on a home.
Of the least affordable UK cities, both St Albans and Winchester were named by Halifax as two of the the best places to live, suggesting their desirability might be driving up prices.
Areas around Oxford, meanwhile, for example South Oxfordshire, Vale from the White Horse and West Oxfordshire, all ranked well in the Halifax chart.
And continuing the trend for university cities, Cambridge has several highly desirable areas nearby, including South Cambridgeshire and St Edmundsbury.
Where can one afford to buy?
Working out where one can afford to purchase a home can be tricky, but the tips below will help you find the areas which are likely to suit your lifestyle and budget.
1. Just how much are you able to manage to borrow?
As a rule of thumb, lenders can lend you up to 4.Five times your annual income to buy a home. However, many may offer you more, or less, depending on your financial circumstances, your credit report and your risk profile.
If you’re buying with someone else, lenders will use your joint income to complete their calculations.
Keep in your mind that saving a larger deposit brings down the amount you need to borrow to buy a home.
You can use our calculator to work out just how much you may be able to borrow.
2. Where do you want to live?
It’s worth taking the time to work out what’s most important to you. Could it be a shorter commute, proximity to family or just being near good schools?
Once you’ve reduced the area you’d prefer to live in, you can investigate the number 1 place for you and your loved ones.
If you’re house-hunting in England, you can use our area comparison tool to check nearby local authorities on demographics, school rankings, house prices and much more.
3. How much are prices on the bottom?
Average prices within an area can give you a sign of methods much a house might be, but they won’t provide you with a full picture.
If you’re buying a flat, for instance, in an area dominated by three-bedroom homes, the average price won’t be any help in exercising just how much you’ll have to spend.
To discover actual prices, you’ll need to begin looking at home listings for your area and up to date sales data for individual properties, to create like-for-like comparisons.